High Tension In Parliament! Will Lawmakers Bow To Pressure On Tax Reforms?

High Tension In Parliament! Will Lawmakers Bow To Pressure On Tax Reforms?

The National Assembly is set to resume plenary today, prioritizing the swift passage of the contentious tax reform bills, according to reports from ireporteronline. After holding its first session of the year on January 14, 2025, both the Senate…High Tension In Parliament! Will Lawmakers Bow To Pressure On Tax Reforms?

and House of Representatives adjourned until January 28 to allow committees to finalize their review of the 2025 Appropriation Bill, which President Bola Tinubu presented on December 18, 2024.

However, the resumption was further postponed to February 4 to provide committees with additional time to engage with Ministries, Departments, and Agencies (MDAs) regarding the budget.

Before the legislative break, President Tinubu’s tax reform proposals, submitted on October 13, 2024, were a major point of contention. Northern lawmakers, governors, and traditional rulers strongly opposed the bills, arguing that they would exacerbate economic challenges in their region.

During the recess, the Nigerian Governors’ Forum (NGF) met with the Presidential Committee on Tax Policy and Fiscal Reforms—the body spearheading the reforms—and reached a compromise. The governors ultimately endorsed the bills after negotiating key modifications, particularly concerning Value Added Tax (VAT) revenue distribution.

Revised VAT Revenue Allocation Agreement:

• 30% of VAT revenue to be distributed based on derivation (previously 60%).
• 50% to be shared equally among all states.
• 20% to be allocated based on state population.

Following this consensus, Governor Abdullahi Sule of Nasarawa State assured that governors would collaborate with legislators to ensure the bills are passed in accordance with the revised agreement.